Managed-care Systems Could Save by Eliminating Restricted Access to Dermatologists

April 12, 1999

Health-maintenance organizations and medical consumers take note: For treatment of skin disease, you''re better off medically and financially by going straight to a dermatologist.

That''s the conclusion of two recent studies being presented as exhibits at the annual meeting of the American Academy of Dermatology in New Orleans. One study shows that for even common skin problems, primary care doctors and other "gatekeepers" in managed-care systems have a propensity to refer patients to a dermatologist. The other study determined that dermatologists take less time to diagnose skin diseases than other doctors.

The implication of both is that the medical system — HMOs and other managed-care systems in particular — would save money, and their patients would receive appropriate care sooner, if patients were allowed direct access to a dermatologist, says Steve Feldman, M.D. Feldman is a co-investigator of both studies and the director of the Westwood-Squibb Center for Dermatology Research at the Wake Forest University Baptist Medical Center, which conducted the studies.

The study on referral rates compared the rates of referral for all visits to primary care doctors with rates of referral for patients with a single dermatologic diagnosis.

"You would think that skin problems are a simpler-than-average medical problem that primary care doctors would treat," said Feldman, associate professor of dermatology, "but it turns out that on average you are 20 percent more likely to be referred for a skin problem than for other medical problems, showing that skin problems are relatively complex to primary care doctors.

"And when you look at what the referrals are for, you see they''re for what one might call simple skin problems — dermatitis, warts, cysts, cellulitis, acne."

The study concludes that HMOs would save at least $77,000 for every 100,000 patients by letting their members have direct access to dermatologists. This figure is based on Medicare reimbursement rates for office visits.

Feldman cautioned that the estimate of savings is probably too low because it does not take into account the cost of medications a non-dermatologist might have prescribed before referring the patient.

"For skin problems the medication costs are often three times the cost of the office visit, so the total cost before the referral is much higher than our conservative estimate," he said.

The results are based on data about office visits to doctors as recorded in the National Ambulatory Medical Care surveys for 1990 through 1994.

A separate study found that dermatologists take less time to diagnose skin problems even when seeing a patient for the first time, compared to a primary care doctor who has known the patient for years.

"You might think that it would be more efficient to go to your family doctor," Feldman said. "They already know you, they know your background, they should be more efficient in taking care of your skin problems. But it turns out that the greater expertise of dermatologists allows them to make a definitive diagnosis rapidly and accurately, with a minimum of testing."

This study — also based on the surveys of office visits in 1990 through 1994 — found that dermatologists required 12 percent less time than other doctors to make a diagnosis with patients 18 or younger, and 20 percent less time with patients over 18. This was the case even when dermatologists were seeing a patient for the first time.

Given that "time is money," Feldman said, there is only one logical conclusion to be drawn from these studies: "If you''re trying to run a managed care system and utilize your physician resources efficiently, you should send patients directly to a dermatologist.

"In the first study we showed that referral is likely, so the initial visit is a waste of money, and in this we show that you use fewer physician resources by going straight to the dermatologist."

But there are also savings to be had for Medicare and traditional insurance programs, Feldman said. "Charges are based on how complicated the examination is, and since nondermatologists take longer, this implies that they are examining other possibilities and doing more testing to make a diagnosis, and therefore they may be billing for a more intensive visit."

The Westwood-Squibb Center for Dermatology Research is a research program within the Wake Fores University School of Medicine that investigates economic, ethical and policy issues critical to the practice of dermatology. It was established in August 1998 with the assistance of a five-year, $1 million research grant from Westwood-Squibb Pharmaceuticals.


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